Roving Bandit

23 July 2015

A few papers caught my eye from last month's repec new education economics papers feed. All from developed countries, but such is economics, a lot of the interesting new research happens on rich countries where the researchers are more likely to know about interesting policies and institutional features to study, and where there is better data (both problems which RISE is seeking to address, by encouraging collaborations between developing country-based researchers and leading academics based at top universities in rich countries, and also by funding new data collection in developing countries).

"Quantifying the Supply Response of Private Schools to Public Policies” by Michael Dinerstein and Troy Smith looks at a reform in New York which increased the budget for some public schools, finding an increase in enrolment at these schools, and that nearby private schools lost business and were slightly more likely to shut down. In an interesting twist, whilst the reform improved quality at the public schools that received extra money, the movement of some students from higher quality private schools to lower quality public schools meant that overall outcomes from the school system were not improved. All of which reminds me of the recent story from Rwanda that some private schools seem to be going out of business by the growth of public schools. What is that shift doing to the overall quality mix?

“The Information Value of Central School Exams” by Guido Schwerdt & Ludger Woessmann compares students in Germany who graduated from states which use a centralized common school-leaving exam to those with a local school-set leaving exam. Better grades are roughly three times more valuable in the labour market when they come from centralized exams than from school-set exams. In Lagos, private school associations are currently in the process of joining together to put their students through common school leaving exams for partly this reason.

Nicola Bianchi’s Job Market Paper looks at "The General Equilibrium Effects of Educational Expansion” - when Italy expanded STEM higher education in 1961, enrolment increased by 200%. However - those students who enrolled didn’t earn any more than they would have had they not enrolled, because the massive increase in the supply of qualified students reduced the labour market premium for that qualification, as well as the quality of education suffering due to congestion and peer effects. Which of course should remind you of Lant’s classic “Where has all the education gone?"

It doesn’t at all, as far as I can tell. As Calum points out, what matters is the systematic review of evidence not one study. And the new Cochrane systematic review doesn’t seem to have responded to the criticism from Duflo et al to their 2012 review, that it ignores quasi-experimental and long-term evidence on positive impacts of deworming (specifically Bleakley 2004, Ozier, and Baird et al).

A replication of the famous Miguel and Kremer deworming paper that launched the whole RCT in development economics movement, is published in the Journal of International Epidemiology today (along with comment from Hicks, Kremer, and Miguel, and reply from the replication authors), with coverage in the Guardian and by Ben Goldacre for Buzzfeed.

You may remember Berk Ozler's review of the draft of the replication paper back in January - concluding

"Bottom line: Based on what I have seen in the reanalysis study by DAHH and the response by HKM, my view of the original study is more or less unchanged."

The ambiguity does make me a little queasy, and pushes me more in the direction of GiveDirectly (I see basically zero risk that giving $1000 to someone on a very low income can really be totally wasted, in the way that an ineffective drug could theoretically have zero impact).

16 July 2015

"Today, approximately 7 million Indians work in six GCC countries, which is more than 50% of estimated 13 million foreign workers present in the GCC. The Indian workers in GCC remit about US$40 billion i.e. around 57% of the total remittances, i.e. US$70 billion India receives annually. Besides contributing significantly to the national forex reserves, the remittances received directly by the workers’ families help in poverty alleviation, support local business, promote entrepreneurship and generate employment."

That’s Zakir Hussain on the World Bank blog. Worth remembering this context next time you read a scandal about the poor treatment of Indian workers in the Gulf.

15 July 2015

I just got back from the fourth of seven events being held around the world drumming up interest in bidding for the RISE “Research on Systems of Education” project. There is £21 million of DFID money to be split between 5 country research teams (with a preference for bids from Ethiopia, Nigeria, Ghana Pakistan, India, Indonesia, Vietnam, or other DFID focus countries) to study reforms that are happening to education systems that might credibly have a big impact of student learning. EOIs due 23rd August.

There is plenty more information on the CGD website and the new RISE website, but to make things really easy, here are a few key links about the project and how to bid (very helpfully put together by Mari).

RISE Research Director Lant Pritchett and Justin Sandefur presenting the research agenda (Video)

30 June 2015

"Site selection bias" can occur when the probability that a program is adopted or evaluated is correlated with its impacts. I test for site selection bias in the context of the Opower energy conservation programs, using 111 randomized control trials involving 8.6 million households across the United States. Predictions based on rich microdata from the first 10 replications substantially overstate efficacy in the next 101 sites. Several mechanisms caused this positive selection. For example, utilities in more environmentalist areas are more likely to adopt the program, and their customers are more responsive to the treatment. Also, because utilities initially target treatment at higher-usage consumer subpopulations, efficacy drops as the program is later expanded. The results illustrate how program evaluations can still give systematically biased out-of-sample predictions, even after many replications.

25 June 2015

- British people are great - having more of us is better- London is the best part of Britain, and not coincidentally the most populous and densely populated part- Population growth is concentrated in cities - Larger cities support economies of scale, more specialisation and diversification, enabling the clusters of activity and agglomeration that drive innovation- A larger population means a greater supply of innovators - A larger population means a greater demand for innovators, and a bigger market for producers- A larger population means more people to share the burden of fixed costs, including national debt

Of course there are costs to crowding, and we need to plan for more infrastructure provision (not least building more housing), but that’s just part of life and really shouldn’t be beyond our wit.

16 June 2015

Here’s a great idea from Al Roth, the 2012 Economics Nobel Prize winner.

Al got his prize for developing his theoretical matching ideas into a computerized kidney exchange - so if you want to donate a kidney to a family member but you aren’t the right match, you can find another pair of people in the same situation from a different city and criss-cross the pairing, so both kidney transplants can go ahead.

"Mr. Roth, however, wants to go further. The larger the database, the more lifesaving exchanges can be found. So why not open U.S. transplants to the world? Imagine that A and A´ are Nigerian while B and B´ are American. Nigeria has virtually no transplant surgery or dialysis available, so in Nigeria patient A’ will die for certain. But if we offered a free transplant to him, and received a kidney for an American patient in return, two lives would be saved.

The plan sounds noble but expensive. Yet remember, Mr. Roth says, “removing an American patient from dialysis saves Medicare a quarter of a million dollars. That’s more than enough to finance two kidney transplants.” So offering a free transplant to the Nigerian patient can save money and lives. It’s hard to think of a better example of gains from trade (or a better PR coup for the U.S. on the world stage). Better matching with computerized markets is saving lives, but more than 100,000 people are still waiting for kidneys in the United States alone."

05 June 2015

"International development work is generally best done by people of the country in question: there is no shortage of talent in and from any of Somalia, South Sudan, DRC, or any other FCAS place you might name, only the conditions in which it might be deployed and developed.

But there is still a role in development work for people from the Global North if they have the right skills, the humility, understanding and connection to apply them well where they are sent, and hopefully the intention to continue to apply them in this work for the medium term. That doesn’t just mean water engineers and hard-bitten Treasury hands, it can also mean the high-achieving, high-potential generalists/fast-streamers that any organisation, the world over, would be glad to have.

But for those bright young people, getting into international development is not always straightforward: it can seem unwise to set off to a fragile state with no particular fixed plan, as many of those now working in this sector first did; getting to, and staying in, some of the places we work is expensive even if you do have systems already set up, let alone if you’re doing this the first time, straight out of College.

This Autumn, we are therefore going to be looking to hire up to six CGA Fellows to send to South Sudan, who will be either immediate or fairly recent graduates."

04 June 2015

"The reference here is to England’s Payment by Results school reform of 1862. According to the Revised code of the Department of Education in Britain in 1862, capitation grants to schools were reduced and payments were made to school on the basis of students passing on-site examinations given by inspectors in reading, writing and arithmetic. There has been much debate among historians about what the payment for results reform really accomplished. Mitch (2010) looks at educational performance across British counties over the 30 years of the policy and shows that during this time, inequalities across counties declined. But in the absence of data on trends prior to the reform, it is hard to establish whether this was a consequence of the reforms. In contrast, the quote here paraphrases Matthew Arnold, a poet and school inspector who returns from a trip to France and notes: “I find in English schools…..a deadness, a slackness and a discouragement….This change is certainly to be attributed to the `Payment by Results’ school legislation of 1862.”(Great Britain Privy Council 1868, Page 290)."

02 June 2015

"Mohammed’s father is an illiterate petty trader. Although he never got any school himself, he has always been determined that Mohammed [13] should get a good education. When Mohammed joined us, we asked him, as we ask all our students, to complete a word reading assessment. The assessment, which we administer one-to-one in the child’s home, involves reading out a list of 90 words that increase in complexity and difficulty, and from the number and difficulty of the words read correctly an inference can be drawn about the student’s reading age based on UK norms.

Mohammed got stuck straight away. He barely made it past the first line or two – words like ‘he’, ‘she’, ‘cup’, ‘said’. Mohammed’s father couldn’t read but he could see that his son was struggling and did his best to encourage him. “Try your best Mohammed”, he said. And Mohammed did. He kept trying. But no matter how long he took he couldn’t recognise the words, and eventually we had to call time on the test. Mohammed’s father was heartbroken. “I’ve paid all this money for school,” he said, “but his head is empty.”

26 May 2015

Evidence from the Guardian UK university ranking, which scores universities both on their value-added (final exam scores minus pre-university exam scores - a measure of how much students learnt at university), spending, and student-staff ratio.

Smaller class sizes do seem to be doing something (small sample sizes, correlation not causation, yadda yadda), which makes you wonder what the high-spend, large class-size universities are spending all their money on.

25 May 2015

These charts by Branko Milanovic deserve looking at again and again. A few years ago Adrian Wood told my entire economics class to print off the Angus Maddison long-run world GDP chart and stick it on our walls so we’d look at it every day. I’d suggest adding the Milanovic chart alongside it.

I was struck earlier today (whilst listening to the latest Development Drums) how these charts could be used to illustrate the comparison between anti-poverty programs and National development that Lant talks about.

Projects to increase an individual’s income in developing countries can help people get a better livelihood amongst those available in that country, but they probably aren’t going to change the overall set of opportunities facing people living in a country. If you want to earn yourself rich, you need to sell stuff to rich people - that means exporting goods or services to rich countries (trade), moving to a rich country to sell your labour (migration), or encouraging rich people to come visit your country (tourism).

Graphically, the most successful ever anti-poverty program might at best move a bunch of people from point A to point B.

By comparison, migrating lets someone move from point C to point D.

And for something truly transformative, national development, probably based on exports, allows the whole country to shift up from E to F.

06 May 2015

"We—the philanthro-niks—want more philanthropy to be strategic. Our fundamental challenge is this: that social change is hard and calls for slow thinking, but most donors will only think fast. It therefore falls to us to do the work that Thaler describes: get the evidence, and make it easy."

About Me

I'm an economist, currently working as a Research Associate on Education at the Center for Global Development in Europe, and on a PhD at the University of Sussex. Before that I worked on policy as a civil servant and consultant in the UK and in Africa.

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Because the consequences for human welfare involved in questions like these are simply staggering: Once one starts to think about them, it is hard to think about anything else. (Lucas 1988, On the Mechanics of Economic Development)

I'm an economist, currently working as a Research Associate focusing on education at the Center for Global Development in Europe, and a PhD in economics at the University of Sussex. I used to be an Economist in South Sudan, hence the silly subtitle. Roving Bandit is a reference to Mancur Olson, not because I think I'm some kind of badass.